The reserve price is the minimum price a vendor is willing to accept at auction. It is set privately by the vendor before auction day and is not disclosed to buyers. Understanding how the reserve price works — and how to estimate it — is a critical part of successful auction strategy.
How the Reserve Price Works
When bidding reaches the vendor’s reserve price, the auctioneer declares the property “on the market.” This means the property will sell to the highest bidder. If bidding does not reach the reserve price, the property “passes in” and the vendor can negotiate privately.
Quote Range vs Reserve Price
| Term | What It Means |
|---|---|
| Quote range / price guide | The agent’s advertised estimate of likely selling price. Must be within 10% of the reserve in Victoria. |
| Reserve price | The minimum price the vendor will accept. Private and not disclosed until “on the market” is called. |
| Hammer price | The final price at which the property sells — always at or above the reserve. |
How a Collings Property Advisor Helps
While the reserve is private, an experienced property advisor can estimate a likely reserve range based on comparable sales analysis, inspection attendee numbers during the campaign, and agent communication signals. This intelligence helps you set your own maximum bid with confidence.
Frequently Asked Questions
Can a vendor change the reserve price on auction day?
Yes. The vendor can change the reserve at any time before the hammer falls.
What happens if no one bids above the reserve?
The property passes in. The highest bidder has the first right to negotiate privately with the vendor — often where the most successful purchases happen.
Should I bid if the property hasn’t been called on the market?
This is a strategic decision. A Collings Property Advisor can advise on your specific auction strategy.
Why Collings Property Advisory?
Collings Property Advisory prepares buyers for auction with reserve price analysis, bidding strategy and comparable sales evidence — all included in our flat $4,500 + GST advisory fee.
Buyer Advisory: $4,500 + GST
Get auction strategy support from a Collings Property Advisor
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